Gould Floats Bare-Bones Resolution Planning Revamp

Why It Matters

Removing or scaling back CIDI plans could lower compliance costs and refocus resolution authority within regulators, reshaping how large banks prepare for failure. This change may improve operational efficiency while preserving essential bankruptcy‑driven planning.

Key Takeaways

• CIDI plans lack explicit statutory authority
• Plans outsource FDIC's receiver function to banks
• Gould proposes filings every five to ten years
• 165(d) plans remain mandated under Bankruptcy Code
• Reduced guidance could lower compliance costs industry‑wide

Pulse Analysis

Resolution planning has been a cornerstone of post‑crisis banking oversight, with the FDIC’s CIDI rule demanding detailed failure‑scenario documents from institutions over $50 billion in assets. Critics, including Comptroller Jonathan Gould, argue that these mandates exceed the agency’s statutory authority and divert resources from core supervisory functions. By positioning banks as the architects of their own receivership, the rule blurs the line between regulator and industry, creating a costly, consultant‑driven process that did little to avert the 2023 Silicon Valley Bank and First Republic failures.

Gould’s reform agenda centers on scaling back CIDI filings to a cadence of once every five to ten years and curbing the binding effect of agency guidance. He differentiates these plans from the 165(d) requirements, which are explicitly anchored in the Bankruptcy Code and therefore retain a legitimate role for bank management. Shifting the responsibility for resolution back to the FDIC and other regulators could streamline decision‑making during crises, reduce duplication of effort, and eliminate the perception that banks are pre‑planning their own collapse.

If adopted, the proposed changes could reshape the regulatory landscape for large banks, lowering compliance overhead while preserving essential bankruptcy‑oriented planning. Industry participants may see a reduction in consulting spend and a clearer focus on safety‑and‑soundness objectives. Moreover, a leaner framework could restore confidence among investors and depositors by emphasizing that resolution authority resides firmly with federal agencies, not private institutions, potentially stabilizing market expectations in future stress scenarios.